modeling in blender units
Blender units are actually metric. 

One blender unit is 1m.

Of course you can disregard that, and model however you want, but when it comes to dealing with light falloff and depth of field in cycles or physics or fluids and cloth and other simulations, the calculations are done using blender (metric) units. In other words blender is trying to simulate those things based on dimensions, light energy and other forces in the real world.

For things to work as the tools are designed, it is recommended to make the objects as their real size would be in the real world.

Note that you can set the units (in the scene settings) to be in the scale you need: metric or imperial 

For 2.8X


For 2.7X


and within those settings you can choose to work in cm, mm by changing the scale

For 2.8X


For 2.7X


Read: Can I change entire scene scale?

You can also change the scale on the viewport to make the manipulation of the geometry easier when working with very small or very large objects.